Diversification is generally considered one of the basic tenets of investing and financial planning. Owning a mix of assets, ideally with a low correlation – including, stocks, bonds, real estate and gold, for example – is Investing 101.
That is… unless you’re one of the world’s most famous investors.
I recently sat down with Jim Rogers and asked for his thoughts on global markets, what he’s buying now, where bubbles might be forming and… asset allocation.
Jim doesn’t buy into the cult of asset allocation.
“Well, I know that people are taught to diversify. But diversification is just that’s something that brokers came up with, so they don’t get sued,” Jim told me. Then he added, “If you want to get rich… You have to concentrate and focus.”
This obviously goes against conventional thinking. But this kind of thinking is what made Jim one of the world’s most successful investors. He co-founded the Quantum Fund – one of the world’s most successful hedge funds – which saw returns of 4200 percent in ten years.
He quit full-time investing in 1980 and went on to travel the world a few times. He also wrote several books about what he saw and learned. Even if you’re not a travel or money junkie and know little about finance, these are some of the most educational and entertaining books you’ll ever read about investing.
...also from Martin Armstrong: The War on Cash – One Giant Leap Forward For Government